Year end inventory of raw materials for powder coating in 2019

In the past 2019, compared with the increase in 2017 and the sharp fluctuation in 2018, the trend of raw materials for powder coating has shown a trend of price decrease and short-term fluctuation. The main raw materials of polyester resin, PTA and NPG, showed a downward trend of vibration. After PTA and NPG prices reached their highs in recent years in the middle of 2018, they began to decline significantly in the second half of 2018. The prices at the end of 2019 basically returned to the level of the first half of 2018, but still higher than the level of online coating at the beginning of 2016, coatingol.com. In addition to the large price fluctuation from May to August, the overall price of PTA is basically stable and gradually downward. The price of PTA is affected by the fluctuation of international crude oil price, periodic maintenance of PTA plant, change of polyester demand and intervention of speculative funds. This year, PX project has been put into production successively, resulting in the price decline. Meanwhile, PTA manufacturers are affected by the factors of considerable profits in the early stage, and many units delay the maintenance plan to ensure the supply of PTA in the market. In 2019, the output of domestic polyester end is estimated to be about 45 million tons, which is mainly concentrated in polyester fiber and bottle chip market.

The growth rate of downstream industry in 2019 slowed down, which makes the demand for PTA in the whole polyester market relatively stable. The factors at both ends of supply and demand lead to PTA price stable and falling. However, due to the relative concentration of PTA production capacity and strong bargaining power of the plant, the price fluctuation caused by the fluctuation of supply side delivery schedule and PTA plant operating rate still has great uncertainty. NPG price has experienced the rising price at the beginning of the year, and it basically shows a downward trend throughout the year. In 2019, although the price of isobutyraldehyde, the raw material, has been rising for many times, it has little impact on the price of NPG due to the rapid decline, the input of NPG new capacity and the stability of downstream polyester demand. Since December, with the launch of environmental protection warning for heavy pollution weather in Shandong Province, the load of some isobutyraldehyde manufacturers has been reduced. Meanwhile, the downstream market has a good expectation for the future market and started to increase inventory. The NPG price at the end of the year has increased by a certain extent. In addition, the price of polyester resin is also affected by the price of isophthalic acid (outdoor type) and trimellitic anhydride (indoor type). Generally speaking, the price of polyester resin is stable and falling. epichlorohydrin, as the main raw material of Epoxy Resin and polyester curing agent TGIC, has been in a sharp fluctuation and upward trend in 2019, with the maximum price difference exceeding 8500 CNY/ton, and the maximum rise and fall in a single month reached about 30%.

The main reason for the price rise is the supply-demand relationship. According to statistics, the total capacity of epichlorohydrin in China is nearly 1.4 million tons, mainly distributed in Shandong, Jiangsu, Hebei, Hunan, Fujian, Jiangxi and other regions. In recent years, the industry has accelerated the pace of capacity reduction, and the average annual operating rate is only 56%. In this case, Shandong Haili epichlorohydrin plant has not been restarted since it was shut down in October 2018. After the "March 21" explosion accident, Jiangsu Province began to investigate the potential safety hazards of chemical enterprises, and the production of epichlorohydrin in in Jiangsu region has also been greatly reduced. To some extent, it caused the shortage of goods supply and short of demand, thus promoting the overall price rise. In the long run, with the resumption of epichlorohydrin production, the supply-demand relationship will be eased to some extent, but there is still a certain gap in short-term supply, and the price will remain high. In 2019, the price of bisphenol A remained stable throughout the year, with an overall stable decline. The demand for epoxy resin and Polycarbonate in the main downstream areas is stable. The price fluctuation of epichlorohydrin in the short term also caused the price instability of epoxy resin and TGIC in the whole year. Titanium dioxide industry overall stable operation throughout the year, the price has declined steadily.